Hey everybody, Paul Gottsegen here again, talking about a series of predictions that ISG is making to help you think about how to orient yourself around the key trends that are going to be happening in 2023. I'm really excited to have Steve Hall here. Many of you probably know Steve, and some of you may not. But Steve wears a lot of hats here at ISG.
Steve runs our European business or EMEA business. He's also the leader of our digital practice. He runs a lot of the technology strategy around data monetization and platforms at ISG. And if that wasn't enough, he's also well known for being the voice and the driver behind the quarterly ISG Index, which is our popular quarterly report on what's happening in the technology and business services sector.
So, thanks for joining, Steve. And you spend a lot of time with clients and spend a lot of time looking at the market. You're a big thinker. As the viewers here are thinking about 2023, I'm sure there are a dozen of trends you could talk about. I'm going to pin you down and force you to just pick the three biggest megatrends that you think will have an inflection point as we cross over into the next year.
Awesome. Well, thanks for that intro, Paul. I think you're right. I need to get rid of some of my hats, but it's fun, and it's been such a great journey this year. So, three predictions:
#1 Digital spend is not discretionary.
I'm going to go against some of my economic friends and some thinkers here. First of all, I think tech spend is going to accelerate in 2023. I do agree with some of the concerns around inflation, potential recession. But in general, digital is no longer discretionary.
#2 The energy crisis fuels cloud consumption.
Second trend, I think we're actually going to see a further acceleration of cloud as we really move forward going into 2023. And the reason for that is really the energy crisis, the energy crisis across Europe, the energy crisis, quite frankly, across the world.
You integrate that with ESG agenda, carbon neutrality, what we're trying to achieve. I think the cloud providers, especially the hyperscalers, are really well-positioned to help us solve both of those problems.
#3 The future of work is digital.
Third, think of meta. Think of the metaverse. Think of everything that's happening. Now, we've seen this big collapse of cyber. We've seen this sort of, let me say, not just cyber from a security standpoint, but cyber, you know, cryptocurrency and those components of it. But what's really taking off is sort of how we think about knowledge workers, how we think from shop floor to top floor and what AR and VR will do with those.
So that's where I would put my bets. Digital economy taking off, cloud taking off, and the workplace of the future is all digital. What do you think?
I like them, and they're all somewhat connected, and yet they stand on their own as key things to focus on. And let's take that first one, Steve. You know, digital spend is not discretionary. It's interesting that you would take a somewhat contrarian point. Like you said, a lot of people are thinking you've got to hunker down. Your point is you can't afford to miss that boat and just focus on cost optimization.